Is there enough to go around?

This is the first of a two part series on the economy, and how our feelings about money can help or hinder our responses to climate change.

This week several parts of North England were put back into lockdown and there is a common satire doing the rounds on the internet which reads;

‘In Manchester, you can be sacked for refusing to go and sit with someone in an office, fined £100 for sitting with them at home, and given a money-off deal to sit with them in a busy restaurant.’

This sorry summary of circumstances captures the tricky line that political leaders currently tread between the health risks of lifting lockdown and the economic risks of failing to do so.

*Politicians are walking the tightrope of balancing the health risks of lifting lockdown with the economic risks of failing to do so.*

It is as though a battle now rages between the need to protect human life against the virus and the drive to preserve the economy for the long haul. And currently, the UK is not looking too good as recent research from the University of Exeter has concluded that so far the ‘price of life’ in the UK was ‘some of the lowest in the world’.

Governments have been forced to take some of the most extraordinary and difficult decisions ever made during peacetime, tasked with regulating an extremely precious resource which most of us once took for granted; human contact.

There is now an economic, social, and even human life cost to the commodity of human contact, and almost overnight the global community has found itself in need of a mutually agreed framework for understanding and regulating it.

Six months ago we used markets, trade, and GDP to assess a country’s success and it’s relationship with the international community. Now we speak of infection rates, quarantine measures, and vaccine trials.

The language of the world, and the measure of success, is changing.

A World of Scarcity

The distribution of the resources available to society- material or otherwise- is what lies at the heart of most political activity locally, nationally, and internationally.

*Politics is the process of deciding how resources should be distributed.*

It’s not surprising that political discourse is frequently derailed by anger, defensiveness, disengagement (or in other words, fear) because grappling with the reality that there might not be enough to go around reminds us of just how vulnerable we really are, and of how little we are in control of.

And we seem to be feeling like that rather a lot.

Despite having one of the largest economies in the world, for example, 22% of the UK’s population currently lives in poverty.

A study in 2018 found that two-thirds of people report ‘a constant sense of dread’ about the lack of time and money associated with the stresses of modern life.

The housing crisis, underfunded NHS, and cuts to other public services were burdening millions before the pandemic hit.

And then there’s the climate emergency. A rapidly shrinking carbon budget at our disposal if we are to halt catastrophic levels of climate change.

It’s exhausting. This is exhausting. Where can we possibly go from here?

How did we get here?

*This is a really accessible book which I would recommend it to anyone who wants to ‘think like a 21st Century economist’.*

If you’re looking for some answers, I would highly recommend Kate Raworth’s excellent book, ‘Doughnut Economics’.

To help us make sense of the forward, Raworth helps us understand how we got here by taking us back to the days of the Great Depression. This was the time when President Roosevelt first trialled measuring the income of the USA’s residents as an assessment of whether his New Deal policies were improving the state of the USA’s economy.

GDP, or Gross Domestic Product, was a relatively new concept then and seemed to prove that a general increase in average income- that is, the growth of the economy- was the cure for many of society’s ills such as public debt, poverty, and national security.

Within a few years, this way of understanding GDP was so well established that Kennedy was voted in on the promise to grow the economy by 5%.

And so the idea that a healthy economy is a growing one has remained pretty much unchanged since. More money means a higher standard of living, and you’ll struggle to find more than a couple of politicians who will tell you otherwise.

But there is a snag with the current economic model, made evident in a graph that demonstrates how economic growth works.

*Is infinite growth on a finite planet even possible?*

If we live on a finite planet, with finite resources, surely at some point this line of material growth has to come to an end?

Surely growth cannot continue forever?

Planetary Boundaries

The idea of economic growth as a universal good was developed at a time when there were two thirds fewer humans on the planet than there are today. So it’s not surprising that few people questioned whether there would be enough of the planet’s resources to go around.

The belief was that if enough people were lifted out of poverty by growing the economy then the whole world’s standards of living would increase.

Which it did. But only for some, and, we now realise, only for some time.

Because it turns out that the economy is actually very difficult to predict (it’s at the whim of human behaviour, after all) and also that there are planetary boundaries that means we can only extract, deplete or alter so much of the planet before it’s resources are strained and eventually it is no longer habitable.

*We need new financial models that bring humans, the planet and the economy into harmony.*

So after a certain point, human acquisition of material wealth will actually begin to reverse levels of prosperity to the point of jeopardising survival altogether. This is not something the economists of the 1930s could have predicted.

Eighty years after Roosevelt first started using GDP to measure human wellbeing, we are now fast approaching a reality where economic growth cannot dig us out of the various holes we have found ourselves in.

Instead, it will be our capacity to distribute, care for and regenerate what we have, rather than our ability to acquire material resource in the first place.

Doughnut Economics

*The American ring doughnut is Raworth’s unlikely candidate for mapping out a new economic model.*

Raworth’s solution to the limitations of our current economic model is genius in its simplicity; it’s the image of a ring doughnut.

The hole at the centre of the doughnut symbolises poverty which limits human flourishing due to a lack of essential resources, such as food and water. The outside of the doughnut is a scale of economic growth that surpasses planetary boundaries, jeopardising the welfare of the earth and therefore of all the species who live on it.

The sweet spot is economic models that fall within the realms of the doughnut itself.

So prosperity is about so much more than economic growth of its own sake; it’s as much about how we grow our economy, what we grow within our economy, and what we place limits on.

Getting to Know our Limits

The difficulty with Raworth’s brilliant solution is that the idea of limitations can be very uncomfortable for us because it forces us to navigate the murky waters of competition and/ or collaboration with our fellow beings.

It’s complex, which isn’t an easy sell in politics at the moment.

But the story of limitless growth is unravelling before our eyes. Not only has a limitless supply of resource failed to adequately address social inequality, but the planet has now served us notice that we have extracted and discarded too much, too quickly, and it is time for humans to discover a new way of relating to our natural resources.

*Limits aren’t always a bad thing- the knowledge that time is limited is something that can bring great meaning and appreciation to our lives.*

But this needn’t be a surprising revelation for us if we consider the natural cycles that are playing themselves out around us all the time.

The seasons of the year. The tide going in and out. The process of birth, maturation, and death.

Even technology— apparently limitless with paper-free letters, ever-luminous screens, and unfading memory— is not immune.

Aside from the environmental and human impacts of sourcing electronic devices, the storage of data will account for around 14% of the globe’s total emissions by 2045 because of the vast areas of temperature controlled housing it needs. (Which is why it’s a good idea to unsubscribe from any emails you don’t read).

Building Something New

We hear lots of language around birth in economic discourse- that is, innovation.

We hear a fair amount about maturation- that is, development and infrastructure.

But you will be hard-pressed to find any mention of that final stage- the death stage- in mainstream politics.

You will rarely hear a politician claiming that the time for limitless material acquisition is coming to a close. That it might be the right moment to re-eavluate the way we consume. That there is a possibility we have somehow lost our way, and we need to let some things go to in order to welcome in something new.

But the truth is, limitless economic growth is dying. It can no longer do for us what we once dreamed it would.

And that can feel scary and disorientating, but the thing with death is, as painful as it can be, it’s always the precursor to new life. It’s the vessel through which something new can emerge.

So, is there enough money to go round? The answer is in what we make of what we have, which is what I’ll be exploring in next week’s blog which asks if money is really what motivates us.

**About Me**
I’m Jo, formerly the founder Director of national climate change charity, Hope for the Future. I am currently researching eco-anxiety and how we can build emotional resilience in our response to the climate emergency.
Welcome to Climate.Emergence- a place to emotionally process what on earth is happening to us and our planet.

On… Money #1